Key Takeaways
- • Multistrategy hedge funds including ExodusPoint Capital Management, Balyasny Asset Management, Citadel and Millennium Management posted March 2026 losses, giving up all or part of gains from the prior two months, according to people familiar with the matter.
- • The losses followed a war in the Middle East, with the conflict involving Iran roiling markets across energy, bonds and equities.
- • Funds were forced to unwind crowded positions as volatility spiked, a dynamic that amplified losses across strategies.
- • Asia-focused long/short funds led declines, down 7.3%, while Europe-focused funds fell 6.3%, per a separate Bloomberg report.
- • Hedge funds sold global equities for a fourth straight month, at the fastest pace in 13 years, as they pulled back from risk.
Summary
Some of the world's largest hedge funds, typically valued for steady returns, lost money in March 2026 as the war in the Middle East roiled markets across energy, bonds and equities. According to people with knowledge of the matter who spoke on condition of anonymity, multistrategy managers including ExodusPoint Capital Management, Balyasny Asset Management, Citadel and Millennium Management posted declines. The losses erased all or part of the gains these firms had accumulated over the prior two months.
The market turbulence forced traders to unwind crowded positions, a process that compounded losses as liquidity thinned and correlations rose across asset classes. Separate Bloomberg coverage reported that Asia-focused long/short equity funds led the declines, falling 7.3%, while Europe-focused funds were down 6.3%.
In response to the volatility, hedge funds pulled back from risk, selling global equities for a fourth consecutive month at the fastest pace in 13 years. The episode underscores the vulnerability of multistrategy platforms, which typically market lower volatility, to geopolitically driven shocks that hit several asset classes simultaneously.
The market turbulence forced traders to unwind crowded positions, a process that compounded losses as liquidity thinned and correlations rose across asset classes. Separate Bloomberg coverage reported that Asia-focused long/short equity funds led the declines, falling 7.3%, while Europe-focused funds were down 6.3%.
In response to the volatility, hedge funds pulled back from risk, selling global equities for a fourth consecutive month at the fastest pace in 13 years. The episode underscores the vulnerability of multistrategy platforms, which typically market lower volatility, to geopolitically driven shocks that hit several asset classes simultaneously.
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